CardFutures.com is hoping to attract those with an eye on making money in sports cards.
Don Harrold spends his days buying and selling stocks online. As a former sports memorabilia business owner, he always wished there was a way to do the same with cardboard. Finally, he and a business partner decided to create one.
CardFutures.com hopes to be an active ‘stock market for sports cards’ by early this fall. Investors will buy and sell cards in units, like shares of a stock, that are easily traded from one person to the next. They’re not trying to compete with eBay or even ThePit.com. CardFutures wants to pump up the volume.
Rather than trade futures on just one rookie or vintage card, the new venture involves someone offering large quantities of cards to their online market . A minimum of 100 of the same NM/MT rookie cards, sets or boxes will be required to bring a lot to CardFutures.
"Our concept is to allow people to make a market," Harrold told Sports Collectors Daily. "We’re not interested in one card. We’re trying to create a model where you can trade as an investor by raising the volume of cards available and raising the potential for profit. The only way to make money as an investor is to buy in bulk."
"The platform used will be similar to an Ameritrade, E-Trade, or a Schwab trading environment," said Chester T. Kelley, CardFutures.com co-founder.
"Some sites claim to be a ‘stock market for cards’ but they fall short in key areas: Low-volume, high transaction costs, and what we call spreads, which is the difference between what someone will pay versus what someone else asks for a card," Kelley said.
CardFutures hopes to give dealers and collectors a way to make money from
the trading of their inventory without selling single cards, haggle with
customers, list on eBay, or sell through the mail.
"Plus, there are many cases where a card, set, or player would sell great in New York but not in San Francisco, but the dealer in San Francisco can’t set up shop in New York," Harrold explained. "The choice now is to sit on the cards or sell them on eBay – where the buyers all want the lowest price possible for the most cards possible. At CardFutures.com dealers have an outlet for inventory they can’t effectively move in the traditional channels."
According to Harrold, CardFutures will create opportunities for collectors, dealers and sports fans to speculate on teams or players early in a season. "The reason people opened 2006 Topps Chrome for example, is to get a Reggie Bush rookie card because they thought he was going to be a great player. But the card is really meaningless. It’s a commodity. Just imagine if you’d bought Reggie Bush in quantity at the beginning of the year. Or a basket of Saints for that matter. If you could have bought 100 shares of Saints cards for $1 per share in a market like ours, chances are you’d have sold them for double that by the end of the season because of the interest and demand."
"We want those who want to make investing an opportunity and not a crapshoot," said Harrold. "That’s hard to do one card at a time, especially if you consider the fees involved. Some sites are geared to the collector. We really think the number of speculators and investors is potentially larger than the number of collectors."
For those who want to invest in cards and trade their favorite players, teams, or sports, the process will involve three steps: 1) Open a trading account, 2) deposit money or cards and 3) trade on the money or cards they deposited. CardFutures.com will accept cards, boxes, or sets as payment to open an account just like money – however, Harrold says that will be on an "as needed" basis.
Dealers or collectors who want to make a market in a player, set, packs, boxes, or cases will set up a "market maker" account, send the cards to the company’s home office, then begin the process of making the market in that player or cards.
"We need market makers for all players, all sports, and all years. From Reggie Bush, Barry Bonds, and Tiger Woods to Joe Montana, Hank Aaron, and Wayne Gretzky," Kelley said.
Harrold says the goal is for clients to put a unique spin on investing. "We want the site to be easy to understand, simple to navigate, and fun to use. If nothing else, investing should be about an enjoyable way to increase your wealth. The goal is to be more like a stock market than a card shop."